CML: Stability continues in the housing market

21 July 2005

The Council of Mortgage Lenders (CML) has released figures in a recent study indicating that the housing market is stable.

The results could be a modest boost for property affordability, encouraging more people to purchase a home.

Lending for home purchasing increased by 20 per cent to £11.9 billion in June, up from £9.9 billion in May.

Total lending in June increased by 16 per cent to £25.8 billion from £22.3 billion in May, the fifth consecutive monthly increase.

Remortgaging increased from £9.3 billion in May to £10.4 billion in June. As a proportion of total lending however, remortgaging fell for the sixth consecutive month from 42 per cent in May to 40 per cent in June.

CML director general Michael Coogan said: "The figures show that the market is stable. Lending for house purchase is on the increase which indicates improved buyer confidence matched by sellers' realistic price expectations."

The average pricing of fixed-rate products remained stagnant in June at 5.37 per cent. However, fixed-rates accounted for 47 per cent of all loans, which is the highest take-up since July 2003.

Mr Coogan added: "Most agree that interest rates have reached their peak, and many expect rates to fall soon. This will provide a modest boost for affordability and help underpin market prospects and the attractiveness of home-ownership."